An example of a self-regulatory authority of the insurance industry is:

The National Association of Insurance Commissioners (NAIC) is a pivotal self-regulatory authority within the insurance industry. It comprises state insurance regulators who work together to establish model laws and guidelines that aim to enhance the regulatory framework for the insurance market. By developing these standards, the NAIC encourages uniformity and consistency among state laws, allowing for better oversight and protection for consumers. This collaborative approach helps ensure that insurance companies operate fairly and responsibly, thereby fostering trust in the industry.

The other options highlight different regulatory bodies and functions that pertain to financial markets or specific sectors rather than the self-regulatory practices of the insurance industry. For example, the Securities and Exchange Commission (SEC) oversees stock exchange activities, while the Federal Reserve is focused on monetary policy and interest rates. Additionally, state Departments of Insurance do establish some regulatory practices, but they do not engage in self-regulatory efforts to the same extent or with the same collaborative framework as the NAIC. Thus, understanding the role of the NAIC in promoting best practices and uniform regulations underscores its significance as a self-regulatory authority in the insurance sector.